Your Home Needs Insurance Too
Is Home Insurance Necessary?
Category: Step 3: Sign Important Stuff | Tags: Banks, Finance, Insurance, Loans, The Journey
Myra doesn’t want anything to happen to you but sometimes, life throws challenges in our way. In the unlikely and unfortunate scenario that something bad does happen, we should always be prepared and take the necessary precautions to make sure that our family and loved ones are safe and taken care of. The bank encourages this and will make you sign up for one of the mortgage insurance below:
Hence, in the event of your death or total permanent disability, your family and house will be taken care of!
Let’s break down the differences!
- This option is the most popular because it’s usually packaged with your home loan. If you already have medical insurance, not many dependents, and plan to keep the house for the long term, it’s ideal for you!
- For MRTA, the insurance company will pay the loan balance of the home to the bank and your beneficiary will get the house! But keep in mind that your beneficiary will receive no extra cash benefit, just the home.
- The premium charged will depend on a few variables such as your age, gender, and others. The older you are, the more expensive the premium will be.
- For payment, you have an option to pay one lump-sum or to include it into your home loan as most banks offer a lower interest rate goodie if you do so.
- The insurance company will pay the loan balance to the bank and pay out the cash benefit to your family in the event of death or disability. So your beneficiary will get both the house and extra cash!
- This policy is ideal if you have a family who relies on you greatly. But the premiums are high and your age plays a big role as MLTA works like life insurance. So the older you are, the higher it will be.
- If you’re looking to keep the property for a short term, your MLTA policy can be transferred to your next home!
- For payment, the MLTA works like life insurance. It’s paid periodically on a monthly, quarterly, semi-annually, or annual basis.
It’s a serious topic to talk about. But I believe that we should always be prepared for the lemons that life might throw. So don’t be afraid to reach out if you have any questions or concerns!